Privately held FXI Holdings disclosed the terms of its anticipated out-of-court transaction to address roughly $1.2 billion of bond borrowings due November 2026, with the company receiving some new money, pushing out maturities and increasing its debt balance, according to sources.
The proposed deal by the One Rock Capital Partners-backed manufacturer of polyurethane foam and polymer products has received the support of holders of 81% of the bonds, the sources said.
The proposed transaction envisions a $50 million capital infusion from certain bondholders in the form of super senior debt, the sources said. Bondholders would exchange their holdings into 61.8% of new 11% first lien debt due 2030 and 39.7% of new second lien debt due 2029, the sources said.
The new second lien paper will pay 16% PIK through November 2028 and shift to a 14% cash coupon thereafter, the sources said. The company is also required to raise $140 million of junior capital in November 2027 to pay down the new second lien debt, they added.
Octus previously reported about negotiations between the company and its bondholders that centered on providing bondholders with takeback paper and longer-dated maturities at par.
FXI was advised by Latham & Watkins, Perella Weinberg Partners and AlixPartners, while an ad hoc group of bondholders was represented by Paul Weiss and Houlihan Lokey, as reported.
The company disclosed second-quarter 2025 results in mid-August, reporting that adjusted EBITDA fell 10% on a year-over-year basis to $36 million as revenue decreased 11% to $288 million. FXI finished the period with $2.2 million in cash and $21 million of availability on its revolving credit facility.
Profitability has declined amid multiyear cyclical volume declines in the mattress market and weakness in demand for autos, Moody’s Ratings noted in May.
